Part 1: Why Design Thinking ?

Part 1: Why Design Thinking ?

When you google the word “design thinking”, you will come across all kinds of color-full pictures from rocket launching to light bulb lighting up. This methodology has taken the world by storm – from Tech companies to Manufacturing companies all are looking to incorporate it. We have come to realize that every company has a different flavor to it. From IBM Design Thinking to IDEO Design Thinking, and is applied differently.

Why Design Thinking?

One of the fundamental question that comes to everyone’s mind is “Why Design Thinking?” Two situations, where design thinking can help immensely is – Uncertainty and Wicked Problems.

1) Uncertainty – Whenever there are questions such as who is my customer, is there really a market for my product, is technology changing too fast and our product will be too late in the market. When there is a lot of uncertainty and lack of clear direction, design thinking methodology can definitely help drive the noise away and provide a clear path forward.

2) Wicked Problems – Wicked problems are one of the most complex problems, business problems aside looking at problems such as “How can we reduce the mortality rate of premature babies in the third world country such as Nepal?” Now, these problems are way more complex than our day to day business problems. One of the interesting aspects that was noticed while understanding this problem was that the incubators were sitting empty in hospitals of Nepal. They realized that less expensive incubators would not actually solve the problem, since most premature babies were born far from hospitals, in rural areas, without access to incubators regardless of their cost.

Embrace Nest (Photo Credits: Embrace Innovation)

The design which was eventually chosen was for an infant warmer, which looks like a mini sleeping bag. It is made of a material which holds in heat, so it can be thrown into a pot of boiling water to get hot and will retain the heat for a few hours. Embrace is the company that launched this product and has programs in 11 different countries which has helped over 50,000 premature and low birth weight infants. And it all started with the design thinking process.

Why is it such a big deal today?

Businesses are seeing success using it around the world, companies are definitely looking at design thinking to assist in growth. As PepsiCo CEO says “I visit a market every week to see what we look like on the shelves. I always ask myself—not as a CEO but as a mom—“What products really speak to me?” The shelves just seem more and more cluttered” – so it becomes more and more important to stand out from the crowd and to connect with your customer. Companies are also leveraging design thinking to expand their digital footprint, where there is definitely a lot of uncertainty and complexity.

Value of Design

To be able to sell the idea of design to a seasoned executive is challenging, when evaluating an idea executives mainly care about 2 criteria – 1) Is it going to help with growth and make more money or/and 2)Is it going to cut costs. It becomes really challenging to provide hard proof of the value of design and show that it can add to business results. This is where Design Management Institute’s study helps. The Design Management Institute’s 2013 Design Value Index (DVI), based on a portfolio of 15 publicly traded stocks from companies considered to be “design-centric” contingent on a set of criteria that reflects best practices in design management, shows a 228% return over the S&P 500. A similar study was done in 2014 and 2015, each year the results have been in excess of 200% over the S&P.

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